Economic Report: U.S. import inflation climbs in September on higher cost of oil, but most prices still tame
The numbers:The cost of goods imported into the U.S. rose in September for the first time in four months, but most of the increase stemmed from higher oil prices. Import-related inflation more broadly was basically nonexistent.
What happened: The cost of imported petroleum advanced 2.3% in September, erasing an increase of the same size in August.
Still, fuel prices are down 5% in the past year, and that’s acted as a big drag on overall import inflation.
The cost of most other imported goods were little changed. Import prices have fallen 1.6% in the past 12 months.
The prices that U.S. exporters fetch, meanwhile, declined in September for the fourth time in the past five months. A weaker global economy, strong U.S. dollar and ongoing trade tensions have hurt exporters, especially farmers.
Crop export prices sank 1.8% last month following a 2.3% drop in August. The trade war with China has reduced demand and thus prices for soybeans, corn and other agricultural products.
The cost of imports from China fell 0.2% last month and have declined 1.8% over the past year.
The decline in Chinese import prices, however, hasn’t been enough to prevent some of the cost of stiff U.S. tariffs on Chinese goods from being passed onto to American consumers.
Even so, the tariffs have not added much upward pressure to U.S. inflation.
Big picture: Inflation is still on the low side and unlikely to rise much if the economy continues to slow despite the effects of tariffs. Falling energy prices have put a cap on overall inflation even though some services such as rents and medical care have been rising at an accelerated pace.
With inflation largely contained, the Federal Reserve has more room to cut already-low U.S. interest rates if the central bank thinks the economy needs more help.
The technical storage or access is strictly necessary for the legitimate purpose of enabling the use of a specific service explicitly requested by the subscriber or user, or for the sole purpose of carrying out the transmission of a communication over an electronic communications network.
The technical storage or access is necessary for the legitimate purpose of storing preferences that are not requested by the subscriber or user.
The technical storage or access that is used exclusively for statistical purposes.The technical storage or access that is used exclusively for anonymous statistical purposes. Without a subpoena, voluntary compliance on the part of your Internet Service Provider, or additional records from a third party, information stored or retrieved for this purpose alone cannot usually be used to identify you.
The technical storage or access is required to create user profiles to send advertising, or to track the user on a website or across several websites for similar marketing purposes.